Ms. Deb Gregg reported that the Commission had received a total of 930 consumer contacts during 2006. Since the last report was prepared for the May 9, 2006, Commission meeting, 104 of these contacts had been received; 16 contacts involved telecommunications services; 23 contacts involved electricity issues; 11 contacts involved natural gas issues; 2 contacts involved electric service and natural gas; 11 contacts involved cellular phone issues; 8 contacts involved do not call issues; and 33 contacts involved issues not regulated by the Public Utilities Commission. In 2006, 818 of the 930 complaints registered have been resolved informally. In 2005, 1,671 of the 1,885 complaints registered have been resolved informally.

Mr. Todd Guerrero, Lindquist & Vennum, stated that they had been working with the Sierra Club for some time on both discovery issues and related withdrawal of the Sierra Club from this docket. He said he thought it was safe to say that the Sierra Club is more interested in pursuing the air permitting issues that will be before the South Dakota Department of Environment and Natural Resources than those in this proceeding. He said they have signed the stipulation and the Sierra Club has signed the stipulation and he asked that it be approved. He said with respect to the stipulation with the Minnesota Center for Environmental Advocacy and other environmental groups, they had also been working with them with respect to discovery issues and they had recently filed a motion to compel certain discovery. He said they have worked out their discovery dispute and will be providing information to them with respect to the computer modeling issues that they want to review. Mr. Guerrero said Applicants have agreed to provide certain information and have also agreed to amend the scheduling and procedural order to allow for additional time for the environmental groups to file some additional testimony and that will be filed by May 26, 2006. He and Applicants will have until June 22, 2006, to file some responding testimony. He said the parties have signed the stipulation, and he asked that it be approved.

Mr. John Smith advised Ms. Karen Cremer and Mr. Todd Guerrero that he thought it was on Friday the Commission issued a third scheduling order in the case and that was attempting to address the scheduling issues that were raised in the MCEA stipulation. He asked them if by approving the stipulation today if they were both in agreement that the Commission's approval of it with respect to those scheduling issues comports with the third scheduling order. Mr. Guerrero said he did not have that scheduling order in front of him. Mr. Smith said the dates that were put in the amended order are the dates as set forth in the stipulation. Mr. Guerrero and Ms. Cremer both agreed with the dates.

Commissioner Hanson moved to approve the Joint Motion and Stipulation to Amend Second Scheduling and Procedural Order between Applicants and Joint Intervenors in Docket EL05-022. Commissioner Johnson seconded and Chairman Sahr concurred. Motion passed 3-0.

Ms. Darla Pollman Rogers, representing FEM and SDREA, stated that she felt all parties requesting intervention had an interest in this docket and asked the Commission to grant intervention to the parties as requested. Mr. Dave Gerdes, representing MDU, stated they had no objection to the interventions. Ms. Greff stated that staff had no objection to the interventions.

Mr. Keith Senger stated that on April 24, 2006, Otter Tail Power Company filed to renew its released energy tariff in the South Dakota electric tariff rate book. He stated that this program allows Otter Tail to make energy purchases from qualified South Dakota customers. He said this program was originally approved by the Commission in July 2000, and the program has been amended several times and this filing simply renews that filing, however, the difference is this is going to be on an ongoing basis. He said previously they had set one year and two year limitations on it. Mr. Senger stated he has reviewed the filing and recommends that the Commission approve the renewal with the same restrictions and reporting requirements as found in the original docket and as amended in following dockets. Commissioner Johnson asked Mr. Senger if any other public utilities have a tariff similar to this. Mr. Senger stated he thought in South Dakota there were three companies, Otter Tail, Xcel and another company that have similar tariffs.

Commissioner Hanson moved to approve the Renewal of a Released Energy Tariff in Docket EL06-013. Commissioner Johnson seconded and Chairman Sahr concurred. Motion passed 3-0.Natural Gas

Mr. Doug Eidahl, Vantage Point, stated that back in November, Northern Valley Communications filed to continue the waiver it had gotten in the past and after discussing the matter with staff they felt that a lesser rate would be in the public interest and therefore they have been in negotiations for the last couple of months to arrive at a rate and in the stipulation basically agreed to ratchet down to an agreed rate. Ms. Sara Greff stated that she would echo Mr. Eidahl's comments. She stated they have been in negotiations with Northern Valley for the past couple of months and feel they have come up with a fair and equitable settlement to get this matter resolved. She recommended approval of the Settlement Stipulation. Commissioner Johnson said he thought this settlement agreement may be similar to but not exactly the same as some we've done with companies in the recent past. He wanted to know if there were any concerns that the terms and conditions are a little different, specifically the phased in rachet down. Ms. Greff said staff had no issues with that. She said they take those on a case by case basis and Northern Valley came to us with their circumstances and in the end they're getting down to the same rate they had in past dockets. She said they're just going to a step down kind of phased in method due to some constraints and building out loss of budget.

Mr. Eidahl said the main reason they have asked for the phased in rate is that Northern Valley has had long term budgets in place for some time and it has built a significant portion of the Aberdeen multi-multi-million dollar investment and the investment was probably higher than some of the other CLEC waivers that the Commission has approved in the past and the planning continued where some of the other investments or waivers that the Commission has granted, the construction had been completed in those cases where the ongoing construction in Aberdeen was an ongoing issue so basically that's why they agreed to the phase in is to allow kind of a timing and planning window for Northern Valley Communications to adjust its plans for the new access rate. Commissioner Johnson asked whether this settlement agreement goes until there is a change with the way that the ICC on the federal level or unless the Commission makes some large rule changes or three years whatever comes first. Ms. Greff said this was correct. Commissioner Johnson asked if that was the same wording as other recent agreements what we have had. Ms. Greff said she was pretty sure it was. Mr. Senger said the wording in the other two settlement agreements that he thought he was discussing gives a specific time. He said the wording on this settlement stipulation mentions something about the Commission probably has to mandate a rate change so if the FCC/ICC docket comes about they would actually have to mandate a rate change or on the Commission's rule changing they may have to mandate a rate change, but the three years is the same. Mr. Senger said fundamentally we're close to the same. The language is different. He said he viewed it as saying something a little different. Commissioner Johnson said he wanted to return to something different – the phase in and he didn't think he had a concern with the phase in, he thought his concern is more consistency. He wanted to know if it was also staff's opinion that this is a unique situation and different enough to take a little bit different approach. Mr. Senger said it's something that raises a little concern, however, due to the circumstances it was either this or probably no settlement so staff weighed its options and decided that they should probably take their offer, but there is some concern that lies there.

Ms. Sara Greff stated that a couple of months ago the Commission granted a COA to SSTelecom. She said there was another question in that docket and that was for an exemption from developing company specific cost-based switched access rates and have entered into a stipulation regarding this matter. Mr. Doug Eidahl stated that the stipulation is identical to Northern Valley's. He said the facts are a little bit different. He said SSTelecom is just starting construction this summer in Milbank, but has plans to make a major investment in Milbank so for much of the same reasons as he had talked about earlier about NVC, they came to basically the same stipulation and settlement as NVC. Ms. Sara Greff recommended approval of the Settlement Stipulation.

Mr. Dave Gerdes stated that he represented Level 3. He said they have no objection to the assessment of the deposit and secondly there has been a stipulation to extend the deadline so there is no need for a procedural schedule. Mr. Jason Topp, Qwest, agreed that there is no need to set a procedural schedule at this time. He said they would not have an objection if the Commission chose to request a deposit at this time, however, he would note that since there has been a stipulation to extend the timeframe by six months that a proceeding may or may not be necessary, and he would ask that the decision of the deposit be deferred. Ms. Rolayne Ailts Wiest stated that the Commission did not have to defer the question on the $75,000 deposit. She said the Commission wouldn't be assessing any amounts until the staff people are working on it and she said she didn't think the initial deposit would be too much. Ms. Heather Forney, Deputy Executive Director, said it would be her intention not to assess the $75,000 deposit immediately which is the maximum. She said it would probably be somewhere in the range of $5,000, and then she said what happens in these types of dockets is if the expenses of the Commission exceed the $5,000 then the Commission sends them a final bill once the docket is wrapped up and if it's less than the $5,000 then the Commission refunds them the difference so she said she didn't know why the decision would have to be deferred. Mr. Topp said he had no objection to that. Commissioner Johnson asked why sometimes the Commission set a ceiling and an initial deposit and sometimes it doesn't. Ms. Forney said that for dockets that are going to go on for an extended period of time she'll assess an initial deposit because the Commission is incurring expenses as it goes, but if it's going to be a short timeframe then she doesn't worry about the initial deposit. Commissioner Johnson asked if it made a difference whether sometimes the Commission makes a motion to assess an initial deposit and sometimes it doesn't. Ms. Forney said she did not think it mattered. Mr. Gerdes stated he thought the motion was up to $75,000. Chairman Sahr agreed.

Chairman Sahr moved to assess a filing fee not to exceed $75,000 pursuant to SDCL 49-31-44 in Docket TC06-007 and to defer action on the procedural schedule. Commissioner Johnson seconded and Commissioner Hanson concurred. Motion passed 3-0.

5. In the Matter of the Petition for Arbitration of Interconnection Agreements in Dockets TC06-036, TC06-037, TC06-038, TC06-039, TC06-040, TC06-041, and TC06-042.

Ms. Rolayne Ailts Wiest asked that the Commission assess a deposit in Dockets TC06-036 through TC06-042. She stated that the parties and her are going to have a conference call on Thursday with reference to a procedural schedule so no action should be taken on that. Ms. Meredith Moore on behalf of the Golden West Companies recommended consolidating Dockets TC06-036 through TC06-042 due to the similarity of these dockets. Mr. Talbot Wieczorek had no objection to the consolidation.

Chairman Sahr moved to assess a filing fee not to exceed $75,000 in Dockets TC06-036 through TC06-042, to grant the Motions for Consolidation and to take no action on the procedural schedule. Commissioner Hanson seconded and Commissioner Johnson concurred. Motion passed 3-0.

Mr. Jason Topp, Qwest, stated that it was his understanding that there were some issues with this tariff when it was filed some time ago and he said they have negotiated with the PSAPs to reach an agreeable approach. He said Jim Carroll, Product Manager, negotiated with the PSAPs and responded to many of the interrogatories that were received in the process. Mr. Topp asked that the Commission approve the tariff. Mr. Harlan Best stated that after the company filed their initial tariff he requested a number of questions be answered by Qwest and he said most of those questions were cost questions and they made some tariff modifications upon his request. He said the company filed revisions to their tariff on March 13 and April 28. Mr. Best recommended that the Commission approve the tariffs as filed on April 28. Chairman Sahr said he knew from the PSAPs' standpoint that they have had some concerns about pricing for some of the upgrades necessary for 911 enhanced services. Chairman Sahr asked Mr. Topp to give him a little bit of an overview about what sort of issues he hopes that this tariff will resolve and what sort of services we're dealing with. Mr. Topp deferred to Mr. Carroll on this. Mr. Carroll stated that what they did in this tariff with the help of the PSAPs was to make sure the language wasn't limited to an analog type of service which the previous tariff language had defined so we would now have the ability to provide the PSAPs higher grades of service whether it be SS7 or IP type of interfaces, as well as moving the structure for the cost basis away from being measured by access line and being measured by the number of records that are kept in the 911 data base so that the pricing and the costs to the PSAPs are much more easily verifiable and identifiable. Chairman Sahr asked if he had worked directly with the South Dakota PSAPs. Mr. Carroll said they did. Chairman Sahr asked him if he recalled which ones they were working with. Mr. Carroll said Sioux Falls, Minnehaha County and he believed Pennington County and then he deferred to Colleen Sevold. Ms. Sevold said as she recalled it was the City of Sioux Falls, Minnehaha County, Pennington County and Brown County and she thought also the association. Chairman Sahr stated it was his recollection that they appeared earlier in the docket. Chairman Sahr asked if their absence was a sign of anything. Chairman Sahr also asked if anybody had talked to them or if they were comfortable with this or not comfortable. Mr. Best stated that he did not speak directly to the intervenors. He said his understanding was that they did file the confidentiality agreements so they could also get the responses to the questions that he asked and he said they never got back to him about any further questions or anything beyond what he had asked so he said his assumption was that they agreed with the new rates that are being recommended in the April 28 tariff filing. Ms. Heather Forney stated that she was originally on Docket TC02-174 and was in contact with the PSAPs throughout their negotiations and working process with Qwest. She said prior to Qwest filing Docket TC06-010 they called to say that they were in agreement with Qwest, that this is the information they had reached, they had worked out the language, they had worked out the pricing scheme and so she did have contact with them prior to this filing.

Commissioner Johnson moved to approve the revisions to Qwest's Exchange and Network Service Tariff in Docket TC06-010 and to close Docket TC02-174. Commissioner Hanson seconded and Chairman Sahr concurred. Motion passed 3-0.

Mr. Tom Harmon, representing Sprint Communications, stated that they filed this application and then determined that the relationship they were creating does not have any customers in South Dakota so requested that the application be withdrawn. Mr. Phil Lusk recommended granting the withdrawal of the application.

Chairman Sahr moved to grant the request to withdraw the application and close Docket TC06-021. Commissioner Hanson seconded and Commissioner Johnson concurred. Motion passed 3-0.

Mr. Jason Topp, Qwest, stated that Qwest has completed negotiations with Dakota Electronics, Nextel West Corp. and Vantek Communications, Inc. and this process is done so the docket can be closed. Commissioner Hanson moved to grant Qwest's Motion to Dismiss its Petition for Approval of Interconnection Agreements to implement FCC Ruling in the T-Mobile Order as it relates to Dakota Electronics, Nextel West Corp and Vantek Communications, Inc. and close Docket TC06-022. Chairman Sahr seconded and Commissioner Johnson concurred. Motion passed 3-0.

Ms. Sara Greff stated the Amendment to the Agreement has been properly filed, does not appear to contain discriminatory provisions, no comments were filed, and recommended approval of the Amendment to the Agreement.

Chairman Sahr moved to approve the Amendment to the Agreement in TC06-031. Commissioner Johnson seconded and Commissioner Hanson concurred. Motion passed 3-0

Ms. Rolayne Ailts Wiest stated that under the Energy Policy Act of 2005, there are five new federal standards for PURPA. She said these standards have varying timelines within which the Commission is required to consider and decide whether it wants to adopt them or not. She asked that the Commission open a docket and essentially get comments on how to proceed. She stated there are different standards and one of the procedural questions is whether they should all be placed in the same docket, or should some of them be grouped. Some of the standards have different timelines and so any interested party or entity or person could comment on these procedural issues. Ms. Wiest recommended that the Commission set a deadline for Tuesday, June 20, 2006, so the comments would be received prior to July 1, 2006, which is when the statute specifically giving the Commission the authority to consider the PURPA standards goes into effect. Ms. Wiest stated she would anticipate that at a July Commission meeting the Commission would open a docket or dockets on these matters.

Chairman Sahr moved to open a docket and accept comments on how to proceed with the consideration of the new PURPA standards and that the Commission set a deadline of Tuesday, June 20, 2006, for comments. Commissioner Johnson seconded and Commissioner Hanson concurred. Motion passed 3-0

Mr. Jim Mehlhaff stated that the blurb he prepared for this pretty well spells out what the situation is. He said the USDA sent a memo telling the grain elevators that they could request permission to store CCC grain on the ground. The first rule in the memo was that they receive permission from the licensing authorities in order to have the emergency storage. He said under our current rules we cannot allow the ground piles. This has resulted in a steady migration of state warehouses to the federal system. He said some of our warehouses leaving the state system prefer dealing with the state. He said they can get a hold of our office when they call and our system provides significantly better protection for the producers. As a result of not being able to place grain on the ground, one of the elevator managers has said that he is looking to leave the system, but that he really doesn't want to. That elevator contacted Mr. Anderson from the Grain and Feed Association and asked him to contact our office and try to get the Commission to make some changes in our current rules so that the Commission can accommodate these requests. Mr. Carl Anderson stated that he is a proponent of the state system because it provides more protection to the producers and easier response from the standpoint of licensing. He recommended that this proceeding begin and he welcomes the opportunity to be part of it. Chairman Sahr stated that it appeared that it would necessitate some rule changes. Mr. Anderson stated it would allow emergency storage as differentiated from temporary storage. Mr. John Smith wanted to know if there was something else they would want the Commission to do today to establish some initial parameters, such as comment dates and he also wanted to know when this happens with the CCC. Mr. Mehlhaff said as soon as possible because when they start hitting harvest in the fall is when the problems are going to start occurring for the state licensed operators. Mr. Anderson said time is of the essence because they want to get this accomplished before the licensing which is July 1. He said the elevators that are contemplating making the change would not want to get licensed by the state and then turn around and change to the federal at some other date because then you have overlapping licenses and you get into the issues of can you get your bond back from the state when you go to the federal, etc. Mr. Anderson said they would like to have this in place by July 1. Chairman Sahr stated that we might want to check into emergency rulemaking. Ms. Wiest stated she doesn't know exactly what the timelines are for emergency rules or whether this would meet the requirements for adoption of emergency rules. She said she would be doubtful that we would be able to do this by July 1. Ms. Wiest stated that the Commission could state that it wants to open a rulemaking docket on this. Mr. Anderson stated that if the Commission were reasonably certain that it was going to get this done before the harvest that would be okay. He said they would want to see that this process was well on the way before July 1. Commissioner Johnson asked Ms. Wiest how likely it would be that we would have some proposed rules before July 1. Ms. Wiest said that would be easy to do. Commissioner Johnson suggested to staff that they have some proposed rules in that timeframe. Mr. John Smith said he thought he could have a draft out extremely quickly.

Chairman Sahr moved that the Commission instruct staff to take steps to propose amendments to the administrative rules to address the concerns of emergency storage and to open a rulemaking docket. Commissioner Johnson seconded and Commissioner Hanson concurred. Motion passed 3-0.

1. In the Matter of a Contract for a Qualified Electrical Engineer (Staff Attorney: Sara Greff)

Ms. Sara Greff stated that we have a unique situation before us. She said Deb Gregg in our Consumer Affairs Division received a Complaint involving a manufacturer and a municipality. She said they have been trying for the last month or so to mediate between the parties and it has now come to the point where we have reason to believe that a formal complaint is going to be filed by the company. It deals with an adequacy of service issue and pursuant to our statutes once that complaint gets filed we have 15 days to hold a hearing in the matter so time is of the essence. The company has not formally filed a complaint yet but we have every indication that is coming this week. In dealing with the parties on the matter, the highly technical issues involved we have realized it is all above our heads and currently on staff we do not have an electrical engineer so we have been trying to find an electrical engineer for the past week which is no easy task trying to find one that has no conflict of interest with the current parties, providers that may be able to take over the service if that is a necessity. We have one bid and two more coming in so she could not give them a number right now. She said time is of the essence so once that number comes in we would like the authority to enter into a contract so that work can begin and we won't have to hold an ad hoc later. Commissioner Johnson asked Ms. Greff if she had a ballpark figure if the Commission wanted to set a ceiling. She said right now the ceiling for instate if we could find someone instate we could probably find someone for about $10,000, but we have not been able to find one that didn't have a conflict instate so right now we're looking at Georgia as possible firms to handle this, we've tried Minnesota, we've tried Wisconsin. We are looking at someone in North Dakota right now. I'm guessing it will be between $20,000 to $25,000. Ms. Greff said staff is at a loss as to how else to handle this because we don't have anybody else on staff that can look at it. She said you need someone on the power utility side to handle power distribution from the city's perspective and then also on the small electrical side so we need to find an engineer that can handle both of those aspects.

Commissioner Johnson moved to authorize staff to enter into a consulting contract with a value up to $30,000 with an electrical engineering firm. Commissioner Hanson seconded and Chairman Sahr concurred. Motion passed 3-0.

Mr. Larry Englerth, One Call, stated that basically the 811 system was put into place by an FCC order in March of last year with the intent to improve access to damage prevention of underground facilities and improve public safety. He said in that order the FCC granted the state commissions authority to handle technical and operational issues and in reviewing the comments previously received his board would like to put forth three recommendations for the Commission to consider. First, he would encourage the Commission to assign the 811 number to the South Dakota One Call Board since it owns the 1-800 number. Second, he recommended that the Commission adopt an implementation date of December 31st of this year. He said that allows both the board and utilities who do public utilities announcements to create their advance spring marketing campaigns to highlight the 811 number. Mr. Englerth said that lastly he would like the Commission to establish a positive response system where the telecommunications companies would advise either the Commission or the Board when they have completed the transition to the 811 number so they don't start their advertising program prior to the time a company has converted and possibly end up with some type of major damage that could have been prevented.

Mr. Richard Coit, SDTA, stated that he and Mr. Englerth have had a number of conversations regarding the implementation. Mr. Coit stated that currently he knows that they have several companies that have already converted and that number is available for that purpose. He said with respect to the recommendations the only one he had any question about is the implementation timeline. If there are a couple of companies that have certain concerns SDTA would like some flexibility to deal with those. Other than that he didn't have any comments and he said he appreciated the cooperation that they've gotten from the One Call Board through the last year and a half or so since they started working on this. Ms. Colleen Sevold, Qwest, stated that it was her understanding that Qwest would have no problem with the earlier implementation date. Ms. Sara Greff said she would echo the comments of the One Call Board as well as the SDTA. She said she realizes there may be some technical difficulty for upping the implementation date, but she said she would really like the Commission to encourage the earlier implementation date as well as the other recommendations made by the Board. Chairman Sahr wanted to know if the 800 number was going to remain alive. Mr. Englerth said the 800 number will remain alive forever. Commissioner Johnson wanted to know if it was the intention of the board that it would not do any advertising of that number until the positive response system indicated 100% conversion. Mr. Englerth said that was correct. Commissioner Johnson said he understood from Mr. Coit that there wouldn't be any technical hardship. He wanted to know if that was what they were hearing from all of the providers. Mr. Englerth said that is generally what they are hearing from all of the providers. Chairman Sahr wanted to know if they were going to need to know before December 31st from these providers that they are all up and running if they're going to start advertising. Mr. Englerth said he thought most advertising would take off in the early March timeframe because the only people digging in South Dakota in the winter time are the professionals. He said he thinks the advertising will be during the January-February timeframe. Chairman Sahr wanted to know if there would be some kind of testing. Mr. Englerth said most companies are doing their own testing. He said once they have had a positive response it would be his assumption that they have done that.
Ms. Rolayne Ailts Wiest stated the Commission could issue an order asking for positive responses to find out when they are going to be able to provide the service from all the affected telephone companies. She said with respect to the first two recommendations, this was the first she had heard of them and she would like the ability for any other telephone company to actually respond to those first two recommendations. Mr. Coit said he thought this recommendation sounded good. Ms. Greff stated that Qwest, SDTA and One Call were the only ones that commented the first time around. Chairman Sahr said he thought Commission counsel's recommendations made a lot of sense. Commissioner Johnson wanted to know if we should defer action on all three components since it wouldn't be necessary to make an order about the positive response system on its own today. Ms. Wiest said the Commission would ask the companies and the companies would be required to tell the Commission when they are going to have the ability to implement the 811 number and staff could work with them to make sure the Commission notified all the companies for them to respond to the Commission. Commissioner Johnson wanted to know if at the same time they were informed of the Commission's action on no. 3 their feedback would be requested on nos. 1 and 2. Ms. Wiest said that was right and everything would be in the same order.